Mercer has targeted net-zero carbon emissions by 2050 for UK, European and Asian clients with discretionary portfolios and the majority of its multi-client, multi asset funds domiciled in Ireland.

The company said this represented a combined total of £31.5bn in assets under management as of 31 December 2020, adding that it would seek to achieve its net-zero goal by reducing portfolio relative carbon emissions by at least 45 per cent from 2019 baseline levels by 2030.

Following the creation of a climate transition plan, Mercer will be work with its appointed investment managers to identify and manage a staged emissions reduction plan, oversee portfolio allocations to climate solutions, and steward an increase in transition capacity across the funds.

Mercer Europe, Asia, Middle East and Africa chief investment officer, Niall O’Sullivan, commented: “We are committing to investing for a 1.5 degree scenario because robust analysis tells us it is in the best financial interests of our members and clients. Another contributing factor is the increasing demand for a rigorous and measureable approach to climate change investment that we see from pension scheme members as well as clients.

“The target is underpinned by our well-established climate change beliefs and scenario analysis over multiple years and is supported by a climate transition plan. We are confident that through preparations completed across asset classes emissions in our funds can be reduced while delivering on our investment objectives.”

Mercer UK head of responsible investment, Kate Brett, said: “As leaders in sustainability across research, advice and solutions, we are excited to be taking such a significant step in Europe and AMEA as part of our global roadmap to supporting clients to achieve net zero.”

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